about. And what happens in the future? Who knows? The last 100 years, though, seems like a good test of how markets work. If stocks can compound at 10 % through the Great Depression and all our wars, through periods of low inflation and high inflation, I think people can be optimistic about the future and be hopeful about the power of stock and bond markets. People don’ t invest unless they think they can expect a fair return. And it’ s that dynamic that leads to the returns we observe and hope for in the future.
You thought you’ d be getting away without me talking about data, but it’ s data that made all the difference. Our financial, our public markets work well. Investors get fair returns when they put up capital and companies can issue stocks and bonds at fair costs of capital. My career in innovation started right out of school. I went to work at Wells Fargo. Wells Fargo at that time was developing the first passive types of investing, which you can think of as index funds. And it was amazing to me because I had just come from the University of Chicago, which is steeped in all this data. What changed in the world was we had data that we didn’ t have before, let’ s say in the early’ 60s. But now you could test things out like, are professional money managers worth the cost? You can decide that for yourself.
Well, as we went on in 1981, we founded Dimensional. And I have to point out, we founded it here in Brooklyn. I’ ve got a million stories about innovating, but this one is about the telephone company at the time. They really weren’ t ready for a startup business. So, when I called up to get six telephone lines, they wouldn’ t give them to me. They thought I was a bookie. So eventually I worked my way up, got all the way up to the treasurer of New York Telephone, and he sent some people down to install lines. When the installers came down, they looked and the whole block in Brooklyn Heights that I was living on only had eight lines available, but they gave me six. And with those six lines and my converted spare bedroom, all of a sudden we had a trading floor, and that’ s how we got started.
We pioneered what became known as factor investing, which is just a different way of saying,“ Look, just because you don’ t think conventional active management is going to add value, doesn’ t mean you need to index.” There’ s another way to think about things, and that’ s what we’ ve been able to build our firm around. And we’ re able to build our firm because of this emphasis on academic research and education.
In fact, when we started Dimensional, we exclusively used academics as our outside directors for our firm and for the mutual funds that we created. When people hear that, they think it was pretty clever. Actually, it wasn’ t very clever. What it was, was that those are the only people I knew. I’ d been in the PhD program at Chicago, and my mentor is Gene Fama. And so one of my first calls was to Gene, and I said,“ Would you like to join and be a founder and kind of really keep us up-todate on research?” He said,“ Sure.”
And then a lawyer we had for the funds said,“ You have to have an independent board of directors for your mutual funds.” No kidding. So we were on campus, and we just walked from Fama’ s office over to the faculty building. The first person we talked to was Merton Miller. Merton, we need an independent director.“ Oh, sure.”
And then we walked down the hall, and coming the other way was Myron Schulz and I go,“ Myron, we need a director.” And he said,“ Well, how much are we going to get paid?” I said,“ Well, Myron, we’ re talking about you being an independent director. It’ d be unseemly if we paid you anything. Besides, we don’ t have any money. But if we get the funds up and going, you’ ll have director’ s fees.”
And that’ s how we started down that path, but it was incredibly important to us and valuable. These guys lent us their names and joined because they believed in what we were doing, and they didn’ t know if they’ d ever get paid. But it did work out for them. And then, all three of those guys became Nobel laureates. And we had two other future Nobel laureates as well; Bob Merton and Doug Diamond joined the mutual fund board later on.
I’ m coming out with a book in the fall, and the title is Stay Calm, which really says everything about what I believe and ties in with the mission of the Museum. If people better understood how markets work and learn to appreciate the power of markets, they would be more likely to invest. They’ d be more likely to stay calm and let the markets work for them. Today, we are inundated with incalculable amounts of data, and most of it is just noise. So, trust public markets, tune out the noise and come up with a sensible investment solution that you can stay with. After studying 100 years of data, that’ s basically the conclusion.
TIMOTHY MICHAEL CARDINAL DOLAN
Archbishop Emeritus of New York
As a grateful and proud New Yorker for the past 17 years, this evening I relish the duty that I have of introducing to you someone I would consider a friend; a great wife, mom and grandma; an accomplished financial genius; and a community organizer. From that city by the lake, my beloved Milwaukee, where I served as Archbishop prior to my appointment here, and with a lot of Milwaukeeans here this evening. Boy, it’ s good to be with you.
I’ m told that this Lifetime Achievement Award is quite prestigious, offered by the Museum of American Finance to a luminary in the financial arena who has made notable contributions to the profession and to the wider community. You’ ve chosen wisely in stretching to Milwaukee for this year’ s recipient. And I’ ll be among those applauding most enthusiastically when she receives it the moment I finish this sermon.
Obviously, the honoree is expected to possess impressive skills in the art and science of financial management. And here our Milwaukeean shines. For four decades, she’ s exhibited shrewd investment and management talents as a celebrated officer at Baird, responsible for $ 190 billion in assets. No one at Baird or First Star where she previously served could be found to play devil’ s advocate for her canonization process this evening. This Museum of American Finance is perhaps guilty of a little plagiarism as they’ re hardly the first to honor this distinguished corporate leader.
Morningstar has already beat them to it. Barron’ s lists her on their Hall of Fame list of influential fiscal movers and P & I’ s inaugural list of the most influential women in institutional investing featured her very prominently. This is enough to bring her east this evening. But permit me please, as one who— while aware of her financial acumen— knows, appreciates and loves her, not just for all that good stuff that she’ s done( brava!), but for who she is. To whom much is given, much is expected, the Bible reminds us, right? So does our awardee this evening view her impressive business portfolio, not as an end in itself, but as a means to an end. The end goal being the common good, and the list could go on— Boys and Girls Clubs, Children’ s Hospital
www. MoAF. org | Spring / Summer 2026 | FINANCIAL HISTORY 31